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China #1, United States #2? 25 Facts That Prove The Transition Is Really Happening

By Michael Snyder, on December 7th, 2010

On a recent episode of The Office, Michael Scott spent much of the show bemoaning the fact that China could soon become the number one economic superpower. Of course by the end of the episode everyone had concluded that the United States would continue to be number one indefinitely, but in the real world things are not so simple. Sadly, the cold, hard facts reveal that China is on the rise and the United States is experiencing a dramatic economic decline. The world is changing and China is projected to become the largest economy in the world at some point during the next decade. Americans have been taught from birth that “the U.S. is number one”, but the transition is really happening. China is passing the United States even in quite a few high tech industries and in many areas of scientific research. The numbers that you are going to read below are absolutely staggering. It is getting really hard to deny that the Chinese are wiping the floor with us economically. In fact, they are beating us so badly that it is hard to put into words.

Of course our leaders are saying all the right things. During the State of the Union address last January, Barack Obama defiantly declared the following to the rest of the world….

“I do not accept second place for the United States of America.”

Well, Barack Obama may not be willing to “accept” it, but that doesn’t mean that it is not happening. China is becoming an absolute powerhouse. Of course that would never have happened if we had not opened up trade with them.

We have essentially merged our economy with China’s over the past couple of decades. Now, if you walk into just about any store and start examining the products you will notice that far more of them are made in China than are made in the United States.

But most Americans still do not take China seriously. Most Americans still view China as being vastly inferior to the United States. Most Americans do not consider China to be an economic or a military threat at all.

The truth is that the world is radically changing. The truth is that China has become a world class rival of the United States. The truth is that the United States had better wake up fast if it wants to stay “number one”.

The following are 25 facts that prove that China is rapidly becoming the number one economic superpower on the globe….

#1 Back in 1998, the United States had 25 percent of the world’s high-tech export market and China had just 10 percent. Ten years later, the United States had less than 15 percent and China’s share had soared to 20 percent.

#2 The United States had been the leading consumer of energy on the globe for about 100 years, but this past summer China took over the number one spot.

#3 Nobel economist Robert W. Fogel of the University of Chicago is projecting that the Chinese economy will be three times larger than the U.S. economy by the year 2040 if current trends continue.

#5 Over the past 15 years, China has moved up from 14th place to 2nd place in the world in published scientific research articles.

#6 Apple iPhones are manufactured in China by workers making about 293 dollars a month (and that was after a big raise).

#7 In 2009, the United States ranked dead last of the 40 nations examined by the Information Technology & Innovation Foundation when it came to “change” in “global innovation-based competitiveness” over the previous ten years.

#8 According to one recent study, China could become the global leader in patent filings by next year.

#9 Today, China controls over 90 percent of the total global supply of rare earth elements.

Read your Bible and the answer becomes obvious. Our time is over. Make your choice now while you can. Jesus is coming very, very soon!

http://www.1913intel.com Matt

China #1 and United States #2 – No, it’s not going to happen.

Clearly the US is in decline. A recent poll showed that nearly 2/3 of Americans think the US is in decline.

China is definitely on the rise and on track to overtake the US. However, China will never overtake the US. Why?

Think about a forest where every fire is put out before it gets too big. What eventually happens? Eventually the forest gets so big and filled with dead wood that once a fire starts it is impossible to put out. The forest experiences a massive collapse in the form of a fire that is bigger than ever experienced before by that forest.

Forced stability by not allowing collapses to happen positions a forest for a major collapse.

It turns out that forest fires, sandpiles, stock markets, wars and earthquakes follow a similar power-law distribution. That means they go into collapse in a similar manner – a system feedback loop drives the system automatically to collapse.

China’s focus on stability and most of all its requirement that economic growth be no less than 8% per year means that it will experience a major collapse before it can overtake the US.

Why must economic growth be floored at 8%? Because of social unrest that could possibly get out of control. Economic growth keeps social unrest under control.

A likely scenario is that China will start to experience economic problems soon. Social unrest will start to rise. Then the danger of war with America becomes a real possibility. Find out why:

I’m not sold on the China thing they have serious structural issues they can’t fix with a state controlled economy. China is able to take so many Jobs from here because the Unit costs for labor a next to zip, labor costs start to dramatically rise the jobs leave. China has entire buildings with nobody in them because nobody can afford to live there, and they are building more. China is totally dependent on the United States and Western Europe as markets for it’s goods, both places are in serious trouble. If anybody remembers the 1980’s the same crap being said about Japan then is being said about China now. I don’t buy it in the long run, China can’t consume it’s own goods it’s still a very poor part of the world.

Eyes wide open

The American Dream
(read: nightmare)

As the “cash-for-clunkers” program has shown everyone who’s not blind, the government has about as much concern for it’s own citizens as a slum-lord does for their tenants.

To summarize what the program was all about, it looks like this:

Take a family with a used car, one which runs perfectly fine even though it’s already paid-off and might need an occasional repair.

Wave a carrot in front of their face that if they “trade-in” their car they’ll get way more than it’s worth in return.

So this American family, who was already getting around just fine in their used car trades it in on a brand new model, and then they are on the hook for 5-more years of monthly payments.

We take those “old cars”, ruin the engines so that they cannot be fixed or resold, then crush the entire thing into a nice little cube and ship it over to China, because, well, we want to show them that we care, and of course, we want them to let us borrow some more money.

So, the real winners are the automobile companies and China, and the Government will claim a victory as well, because after all, they get to continue spending the money of our great-grandchildren.

Gary2

If only we taxed those greedy, mean rich people more and more, we would have enough money to pay unemployment benefits for American workers for the rest of their lives. Rich people are such mean baddies.

Grains

It is inevitable.
Everything that has a beginning has an end and just like china rises, it will fall at its time.

Yet it doenst mean USA has to end in nothingness, it can still be a beautiful place to live with its own beauty. The question really is:

Are americans OK with the fact the wont be #1 anymore? or will the selfdestruct in selfpity?

Some Dude

Where the **** has everyone been for the last 3 decades or more?

HELLO!

Owen

Well, welcome to the New World Order! It appears to this reader that we are entering a period in which all the natural resources and capital goods that can be liberated from this country will be, followed by a massive atomic strike by Russia and China. Recall that much of the rationale for our current China policy was designed so that America could “play the China card” in the event of nuclear war — well, that’s not going to happen. After the strike, America would probably not even make the top 100 countries of the world list. Shortly thereafter, it is planned that the era of “independent” nation states will end. It’s time to dust off your Bibles to see how this will unfold.

Midcenturyman

Thank you for posting this. Great article indeed with lots of disturbing statistics. I (like many) am a middle aged man, whos trade is obsolete and am scrambling to try to get some kind of retraining so that I can get a decent job. It’s about time someone speaks up about the fact that the good ole USA is not so good anymore, in many regards. It is hard for me to believe that we will EVER recover, I just don’t think it is going to happen. We make less and less here, and I think China has already beaten us in the “green” technology, and besides with all the greed here it may be many, many years before we are really not dependant on foreign oil because there is just too much money being made on oil. Everything in this nation is about the money. It has been the “god” of this country for many years, everything has to be made cheaper, cheaper, cheaper…. With taxes, living expenses, housing costs, etc. we will never be able to compete with someone earning several hundred dollars per month. Not to sound too negative, but I think this nation is lost forever, and will not have any long lasting recovery, even with a revolution to take back the government, we still have the moral problems and the economic wasteland that we call US manufacturing. I collect mid century antiques, ( 1940’s-1960’s) and even the smallest consumer items were made here. That meant jobs and a strong economy.

zack

The US is still #1 in a some categories
-debt
-fattest citizens
-military spending
-fake GDP

Apathy; entitlement, re-distribution, moral decay? Where the hell did this country get these ideas?

Leadership will bring America back. That is, when and “if” we ever see it again. I hope it’s sooner than later.

de Malfosse

#26 The United States is no longer a net food-exporting nation & the (USDA?) reports by (2014?) 40% off all fruits and vegetables consumed in the US will come from China.

MidCenturyMan

Wow! That veggie and fruit statistic is disturbing. For me and my family, I will have a nice garden, and eventually try building a greenhouse. City folk however will have to rely on the Chinese food. That is so ridiculous it blows me away. Here we have a lot of land here in the USA, and we need to get food from China!!! Again, it is really about greed and the love of more profit, and also the corrupt health system that profits off sick people, so they are in bed with the FDA insuring that Americans will be sick and overweight, thus fueling the never ending drug revenues….

I remember as a kid in the late 1970’s, we used to use a seasoning for soups called “Maggi”. It was salty, but very good. Grandma used it for years, so as tradition has it, my Mom used it also. Long story short, was visiting Mom a few weeks ago and had the priviledge of enjoying her home made turkey soup, and we had Maggi. I was reading the bottle and it said “made in China” Yes, I fell out of my chair in disbelief…is anyhting sacred anymore, or has everything been sold out for profit!!!!

Gary

I am really flattered that people are even posting in my name, however, if there is no picture/avatar by my post its not me.

Blame the greedy CEO/corporations for outsourcing all the good jobs and leaving crap low wage service jobs.

The winners of globalization need to compensate the losers.

Tax these corporations to the max to compensate the looses in the global trade.

Randy

China vs USA is another misdirection. China will simply be the core, the rest of east Asia (Singapore, Taiwan, Malaysia, Vietnam, Korea, etc), will follow, as the production center of the globe. The idea of a single nation-state vs USA is a type of bi-localizing an issue which is global in scope. Asia is about production, the US is about finance/banking and branding. Thus, where the US will find its future is in money laundering global assets, diversification, etc, but not in producing useful entities for the world markets.

Today, even MIT, yes, the Massachusetts Institute of Technology, number one tech school in America, is sending 40% of its graduates to financial or management consulting firms. Those are not tech career tracks, hate to say it. If this is our best, then what’s our worst? All and all, the US is doomed but it’s not as simple as China vs USA, it’s about our own inability to get our best out of management/financial/medical careers and the need to push out productive work into Asia and eastern Europe for the sake of global labor arbitrage.

Mike

My engineer friends have been saying this for years. I have watched many electronics be made by Asia, and when I was in school in 1985, over half the students in EE were Asian.

American kids dont like science, and by my old crotchety observation are lazy. We have a government full of Lawyers and bean counters.

What we need is another Kennedy to force our students to undertake science, engineering to have any chance of gaining any stability.

This is the century of technology – the Aggrarian society is over.

When I tell people about this – they laugh!

We cant outsource our way to properity, make liar loans to prosperity, cant tax ourselve back into properity.

Bill Clinton sent us on a one way trip down to Walmart when he signed NAFTA. To be fair, the Republicans would have likely done something similar.

Nickelthrower

Greetings,

Of course China (India also) will have larger economies than the United State simply because China has more than 1.2 Billion people. Its neighbor, India, has a billion people too. The United States is a small market compared to those numbers and all you people that think China and India will just die without the USA buying their crap should really get out more.

First, what will we use in the future to buy their crap? We shipped most of our manufacturing jobs away – they have the bright new factories and we have, um, Detroit. We do not produce much of anything anymore.

Second, we failed our children and now they pretty much rank dead last in the industrialized world. A full 50% of High School Seniors can not find the United States on a map. When it comes to math and science, other nations mop the floor with us.

Finally, our aging infrastructure will probably get us before anything else does. Our electrical grid, railroads and water treatment are all pretty much at the end of their life cycle. Hell, most Americans probably do not even realize that we rank towards the bottom even for things like internet speeds. Did you know, for example, that Koreans enjoy internet speeds 40X faster than what we have here and they pay less too!

That is the new reality.

William

Being an antique at age 63, I have watched this sad situation unfold in earnest since the early 1980s. It was not always this way, and it did not have to be this way now. What we have now is the result of stupid foreign policies, inept trade policies and stunningly bad fiscal policies. These have been augmented by the monetary actions of the FED, which is UNCONSTITUTIONAL. While I hope the decline will be gradual, I fear that it could be sudden.
Having a Republican in the White House for 20 of the past 30 years did not help. Most of the advances for average people, built up since since the 1930s, have been, and are today, under attack by Republicans. You get what you vote for. We had a chance before the Smirking Chimp and war criminal Bush cut taxes when we could not afford it, and then started an unnecessary war of choice in Iraq, fought with borrowed money. And, now, we see Republicans cornering Obummer to extend tax cuts for those with income over $250K. Long years ago, at the founding of this country, a wise man said something to the effect that, you have a democracy is you can keep it. Our democracy has been crushed by big corporate interests and the drive for EMPIRE.

Republic

What if the states succeeded into a republic again instead of this corrupt oversized democratic nation? Clearly bigger is not better.
Let’s face it, the only way we can compete, and have a free market is too downsize. Just lIke the EU is proving, the idea of big govt and a shared
Currramcy only gives central authority and elite more power.

We are not a free nation. We do not have a free market.

mondobeyondo

I did find one American product during a visit at a local Wal-Mart yesterday.

It was a wooden picture frame set. The kind where you can place four 4×6 inch photographs in. The package said “Made in the USA”.

It was the ONLY item I saw that was made in the USA. Nearly everything else, from space heaters to clothing, to microwaves, laptops, printers, etc. was “Made in China”, “Made in Mexico”, “Made in Indonesia”, etc.

I bought the photo frame. It was the ONLY thing I bought at Wal-Mart yesterday.

mondobeyondo

We sold our soul for fool’s gold.

America could have easily cornered the cell phone market a few decades ago. Computers, the same. (Remember Hewlett Packard? Texas Instruments?) We once ruled the television manufacturing industry (still have an old RCA analog TV set! Great quality!)

But we lost the edge on the electronics industry when manufacturers decided they could exploit cheap overseas labor for profit. And we Americans enjoyed the much lower prices for those items. Like a good trout or bass, we took the shiny new bait and got hooked.

So it’s nearly 2011.

My cell phone – made in China
Computer – made in China
Broadband data card – made in China
32 inch HDTV – made in China
Every single Christmas decoration – made in China
Plastic Christmas tree – yeah, you guessed it!
CFL light bulbs – right again!
PS3 game module – well, what do you know!

The damn Lipton tea I drink was probably imported from China too, for what I know!

LS

Mike,

I see a War China has problems of it’s own a failed bond auction, inflation,empty cities, food shortages, etc. and they are backing N. Korea most likely to use as ally’s against us. They are already mad the Fed devalued the dollar and caused inflation and what better way to get rid of the hungry billions of citizens in their own country.

#25 In 2010, the number one U.S. export to China is “scrap and trash”.

An excellent description of the increasingly valueless piece paper formarly known as the US DOllar

http://zentropist.wordpress.com Zentropist

While the situation certainly looks grim, it is not a foregone conclusion. The U.S. is suffering a major decline, and to reverse it will require significant investment in our physical and technical infrastructure, as well as education, and the need to reduce many of our entitlements which exist at ALL socio-economic levels.

Don’t want to work or refuse to develop any marketable skills (including the ability to perform manual labor or lesser skilled “service” work)? Then you don’t have the right or ability to collect unemployment or welfare indefinitely. There’s compassion and social responsibility, and then there’s freeloading. Distinguish between the two.

Reduce government inefficiency and bureaucracy by holding bureaucrats accountable and reducing spending. Medicare, Medicaid and Social Security all require a serious discussion, because as these currently exist they are not sustainable.

As for China, as others have pointed out there is enormous instability in China right now, with huge disparities in income between the coasts and the interior. China has made enormous gains, and historically has contributed a great deal to the world, but it too has formidable challenges to overcome or could see massive unrest itself.

We’re in this pickle because Americans keep voting for establishment candidates of both parties who are actively working to creat a one world government. Unforately, folks, there’s no room in that new order for a prosperous U.S., and therefore we are being downsided. Until Americans recognize this fact, there is no hope that we will be able to prevent this fate. The bad news is it appears that Americans have already been dumbed down enough to ensure that they will never wake up to what’s really happening.

Radny

“American kids don’t like science”

I disagree with the above; what they don’t like is working for peanuts or for a no future career like today’s engineering tracks (*Hint: to be sent abroad in another business cycle or two).

Where science and engineering graduates are headed is for medicine (both doctor-ing and other areas like pharmacy, PA, nursing, etc), trading/finance, patent law, or management consulting. Look at top graduates from Carnegie-Mellon, MIT, Chicago in areas like applied math or physics and you can see many of them headed off for quant careers on Wall Street. These folks earn $150-250K/yr … why would they instead want to work for a failing R&D company which annually sends a certain percentage of work abroad.

Don’t blame the kids, blame the system which had systematically lied to them about the shortage of scientists and engineers. When a real shortage occurs, perhaps some quants or surgeons can volunteer their time to help out with what’s left of America’s tech infrastructure. My bet is that this is better left to NSA or the Army Corp of Engineers which can hire scientists/engineers, put them on a near permanent payroll and thus, retain their service for when it’s really necessary than in trusting corporate America, which wants to outsource all tech work, and retain only management consultants as near permanent staff.

Randy

—“American kids don’t like science”

I disagree with the above; what they don’t like is working for peanuts or for a no future career like today’s engineering tracks (*Hint: to be sent abroad in another business cycle or two).

—-

I’ll give you an example… a bright 19 year old interned at my tech company. Her stats were 3.8 UGPA in EE. She did QA, was appalled by the no of emails/IMs to Asia where a majority of the testing was done. Her six months at my company were not inspiring. When she’d returned to school, she re accessed her career and applied for law school. She earned a partial scholarship from her engineering society and then attended a top fifteen law program. She’s now interning at a Patent/IP firm at nearly twice the salary of her prior CO-OP. She will not return to tech. Upon graduation, she’ll be at a six figure salary and probably max out near ~$250K/yr unless she’s in a partner track.

http://patrick,net What?!?!

I am sure all this is somehow Obama’s fault just like all the rest of the woes of the US.

http://none richard geway

Hello, for years i look at situations over the world. I see that the USA, is falling. They are standing one foot in front of a ravine. Your government will push you that one foot. With an Obama as a President (no right att all, born africain)practical muslim, nice looks but nothing in his head USA will fall hard. I do think that the NWO has to get a WWIII to get out of their slob. The time is coming… soon!! And why does a lot of politicians like to see that Wikileaks Boss Asange should be killed??? What are they Hiding?? 9-11,Fema-Camps,FED, Quantiative easing, Derivates (paper without any worth), social assurance, global interference.. What are the USA doing in afganistan??? In Irak??? What are the costs of military interference without reason?? It seems to me that the americans do not want to see what is going on in reality.. Please open your eyes and don’t let them take your land away.. like to come one time to the beautifull big land.

Sam

Sir,

“Of course that would never have happened if we had not opened up trade with them.”

I disagree with you on that point. Whilst “…it took Nixon to go to China,” the fact is that China would have opened eventually to trade. More importantly, we have only ourselves to blame for exporting jobs to China.

Minimum wage, environmentalism, hiring quotas, and others have done much to facilitate the move to China. Businesses are there to make money for the owners, not provide “social justice.” This current occupant of the White House is so ignorant of business that he wants to make coal production prohibitive, hostility to the “rich,” and wipe out all small businesses. So now coal producers are selling to China, and more small manufacturers are fleeing to friendlier shores. The result is less JOBS, less hiring, and crummy products that fall apart the minute they are out of the box.

Heck, we CAN do it. As a part-time manufacturer myself, we can produce QUALITY product, and have people return to AMERICAN MADE when QUALITY is reintroduced. I’ve seen it time and again where people will buy QUALITY, because QUALITY is seen as value, much more than “low prices.” If we also had stiff tariffs for the garbage coming in, and the repeal of decades of onerous restrictive laws, then people will surely return to QUALITY American-made, and not cheap foreign made.

Randy

—Minimum wage, environmentalism, hiring quotas, and others have done much to facilitate the move to China.—

Misdirection, the move to Asia started with fab plants to South Korea and Taiwan during the 80s. Then, software engineering to India during the mid-90s. The reasons for it have to do with labor arbitrage and tax deferral strategies, not some Liberal conspiracy. In reality, both parties are akin to the corporatists but play the little guys against one another. The difference is that the Democrats want the nanny-state (with subsidized everything) whereas the Republicans are happy with company towns (like Pullman Town) or eviscerated urban centers like Gary Indiana, so that people either take orders from their chiefs in the Hamptons or face living on skid row.

As for manufacturing, I doubt it’ll make a comeback. So far, only agriculture and high end stuffs like Wisconsin and Vermont dairy products have real export value for the American economy. Right now, the heart of manufacturing is for defense contractors, see Honeywell, Pratt & Whitney, Raytheon, TI, etc. That’s about it.

The other sector will be shale and mineral extractions, as the US won’t be able to afford China’s blackmail for raw materials. At the same time, Canadian mineral imports are practically *free* for American use since the corporations also control Canada. And eventually, the Dems will cave in and allow for coal to gasoline conversion, since America is the Saudi Arabia of coal.

None of the above bodes well for someone who’s not well connected in the decades ahead. Our best and brightest children will be surgeons, traders, or patent lawyers. And if they don’t make the entrance exam cut offs, then they’ll be on the streets with the rest of us.

Sinag-Araw

The mistake of the post-gospel Western nation is this:

Most Western Christians are well versed on the topic of salvation but never left the foot of the cross. Yahshua did not intend us to stop on Him but to go and know our Father. Religion wants us to stop on the Son but the Son always points toward the ultimate owner of the kingdom, His name is Yahweh.

“And if it seems evil in your eyes to serve YAHWEH,
choose for yourselves today whom you will serve, whether the gods whom your fathers served Beyond the River or the gods of the Amorites in whose land you are living.

But as for me and my house, we will serve YAHWEH.” Book of Joshua 24:15 from Hebraic Roots Bible

Stick a Fork in it

There once was a country with massive exposure,
to living off credit without much composure;
thus its future was set,
now it buys its own debt,
and its fifty states are all in foreclosure.

Nexus

It may be true that some of the projected trends may not be realised for a number of valid reasons in term of internal social and economic contradictions within China. However, this does not excuse the effects of the policies of the US Administration that have made it easy for bankers to finance off shore investments, US transnationals to off shore and in shore overseas labour, etc. China is merely one side of the equation.

http://yahoo bill agner

Americans are already behind China. Their Urban Planning is fantastic. China owns the next century. Unlike many Americans who know nothing of other countries and buy into We’re Number One” I was fortunate to spend 3 months in China. Very efficient, very friendly, very clean, and I have seen more begging in Tampa on a Saturday afternoon than I did in all of China.

Freeman Barnett

The Bible says, the wicked are turned into Hell along with every nation that forgets God. Let us return to what our forefathers stood on, The Bible

Freeman Barnett

?The Bible says the wicked ar turned into Hell along with every nation that forgets God. Our forefathers were on the right track.

Latashia Gentzler

Thank you for your article, I learn a lot of valuable things,this is a great help to me.Thanks

Thoran

Yep because of Obama by the next decade there will be a red flag with a yellow star flying proudly over the White House and I am going to bet 50,000 dollars that that’ll happen